Results Presentation 9M2011 LISBON, OCTOBER 28 TH , 2011 0 - PowerPoint PPT Presentation

Results Presentation 9M2011 LISBON, OCTOBER 28 TH , 2011 0

Disclamer This document has been prepared by EDP - Energias de Portugal, S.A. (the "Company") solely for use at the presentation to be made on the 28 th of October 2011 and its purpose is merely of informative nature and, as such, it may be amended and supplemented. By attending the meeting where this presentation is made, or by reading the presentation slides, you acknowledge and agree to be bound by the following limitations and restrictions. Therefore, this presentation may not be distributed to the press or to any other person in any jurisdiction, and may not be reproduced in any form, in whole or in part for any other purpose without the express and prior consent in writing of the Company. The information contained in this presentation has not been independently verified by any of the Company's advisors or auditors. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. Neither the Company nor any of its affiliates, subsidiaries, directors, representatives, employees and/or advisors shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. This presentation and all materials, documents and information used therein or distributed to investors in the context of this presentation do not constitute or form part of and should not be construed as, an offer (public or private) to sell or issue or the solicitation of an offer (public or private) to buy or acquire securities of the Company or any of its affiliates or subsidiaries in any jurisdiction or an inducement to enter into investment activity in any jurisdiction. Neither this presentation nor any materials, documents and information used therein or distributed to investors in the context of this presentation or any part thereof, nor the fact of its distribution, shall form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever and may not be used in the future in connection with any offer (public or private) in relation to securities issued by the Company. Any decision to purchase any securities in any offering should be made solely on the basis of the information to be contained in the relevant prospectus or final offering memorandum to be published in due course in relation to any such offering. Neither this presentation nor any copy of it, nor the information contained herein, in whole or in part, may be taken or transmitted into, or distributed, directly or indirectly to the United States. Any failure to comply with this restriction may constitute a violation of U.S. securities laws. This presentation does not constitute and should not be construed as an offer to sell or the solicitation of an offer to buy securities in the United States. No securities of the Company have been registered under U.S. securities laws, and unless so registered may not be offered or sold except pursuant to an exemption from, or in a in the United States. No securities of the Company have been registered under U.S. securities laws, and unless so registered may not be offered or sold except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of U.S. securities laws and applicable state securities laws. This presentation is made to and directed only at persons (i) who are outside the United Kingdom, (ii) having professional experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 (the "Order") or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "Relevant Persons"). This presentation must not be acted or relied on by persons who are not Relevant Persons. Matters discussed in this presentation may constitute forward-looking statements. Forward-looking statements are statements other than in respect of historical facts. The words “believe,” “expect,” “anticipate,” “intends,” “estimate,” “will,” “may”, "continue," “should” and similar expressions usually identify forward-looking statements. Forward-looking statements include statements regarding: objectives, goals, strategies, outlook and growth prospects; future plans, events or performance and potential for future growth; liquidity, capital resources and capital expenditures; economic outlook and industry trends; energy demand and supply; developments of the Company’s markets; the impact of legal and regulatory initiatives; and the strength of the Company’s competitors. The forward-looking statements in this presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. Important factors that may lead to significant differences between the actual results and the statements of expectations about future events or results include the company’s business strategy, financial strategy, national and international economic conditions, technology, legal and regulatory conditions, public service industry developments, hydrological conditions, cost of raw materials, financial market conditions, uncertainty of the results of future operations, plans, objectives, expectations and intentions, among others. Such risks, uncertainties, contingencies and other important factors could cause the actual results, performance or achievements of the Company or industry results to differ materially from those results expressed or implied in this presentation by such forward-looking statements. The information, opinions and forward-looking statements contained in this presentation speak only as at the date of this presentation, and are subject to change without notice unless required by applicable law. The Company and its respective directors, representatives, employees and/or advisors do not intend to, and expressly disclaim any duty, undertaking or obligation to, make or disseminate any supplement, amendment, update or revision to any of the information, opinions or forward-looking statements contained in this presentation to reflect any change in events, conditions or circumstances. 1

9M11: Highlights of the period Sound Operating Performance EBITDA: €2,775m, +5% 59% of EBITDA from out of Portugal: Strong growth in wind (+16%) and Brazil (+12%) Iberian traditional operations: EBITDA -1% Resilient regulated/contracted activities; weaker performance in liberalized market Resilient regulated/contracted activities; weaker performance in liberalized market Opex: +3.0% YoY (including wind power & Brazil), -2% YoY in Iberia; Opex/Gross Profit at 27% Average cost of debt of 4.0% in 9M11 (+50bps vs. 9M10), avg. debt maturity of 5 years Net Profit of €824m, Earnings Per Share +6% YoY 2

9M11: Highlights of the period Capex down to €1.353m in 9M11 (-€606m vs. 9M10): driven by cut of expansion in wind power in US Sale of 14% in EDP Brasil (Jul-11) + stake in Ampla (Oct-11): €450m 90% of 2011 disposals’ target achieved Net debt of €16.6bn (-€0.3bn vs. Jun-11; +€0.2bn vs. Dec-10), Net debt/EBITDA (1) of 4.1x Financial liquidity increased to €4.0bn by Sep-11 (+€1.0bn vs. Jun-11) €3.3bn raised from diversified funding sources over 9M11 Improvement of regulatory visibility in Portugal No change in CMECs value/earnings; Proposal for 2012-14 tariffs and parameters on Oct. 17 th Improvement of free cash flow generation, financial liquidity and credit ratios Reinforced visibility on future cash flows (1) Excluding regulatory receivables 3

9M11 Operating Headlines 9M11 Generation Breakdown by Technology Installed Capacity (%) (GW) Wind Hydro CCGT Other (1) +6% CCGT Other (1) 22.6 21.3 13% 25% 22% 23% 17% 17% 16% 16% 28% 31% 32% 34% 62% Hydro & Wind 62% 29% 31% Hydro & Wind 9M10 9M11 Installed capacity up 6% YoY Wind & Hydro: 62% of total capacity and of energy produced in 9M11 (1) Coal, thermal special regime, nuclear and fuel oil / gasoil. 4

9M11 EBITDA: Increasing portfolio diversification EBITDA Breakdown by Geography (1) (%) 16% Brazil 18% 19% 20% 6% 15% EDP Renováveis 18% 20% 19% 20% 16% Spain 19% 19% 57% Portugal 48% 47% 41% 9M06 9M09 9M10 9M11 Weight on EBITDA from operations out of Portugal increased from 43% in 9M06 to 59% in 9M11 (1) As of Sep-11, EDP changed its accounting policy as to the interest cost and estimated return of the fund assets: the respective amounts, so far accounted as operational expenses, are now accounted 5 at financial results level. Only 9M11 income statements comply with this change, implying a positive impact on EBITDA of €66m in 9M11.